The Economics of Alternative Energy Sources and Globalization

The Economic Feasibility of Electricity Generation from Biomass on the South Plains of Texas

Author(s): Xiaolan Liu, Michael Farmer and Sergio Capareda

Pp: 158-169 (12)

DOI: 10.2174/978160805233211101010158

* (Excluding Mailing and Handling)


This study explores the economic feasibility of bio-energy generation from agricultural waste biomass in order to complement local nucleus business by meeting specific market demand for electricity. With GIS maps combined with production location analysis, we identify the locations of appropriate sites (groups) and associated volumes of cotton gin waste (CGW). Based on the Bayesian Markov chain Monte Carlo (MCMC) method, we estimate the probability distribution of CGW supply, which is an important factor in economic models to search optimal firm scales. Sensitivity analysis and cost/benefit analysis also are conducted. We find convincing evidence that onsite gasification has positive profit margins for generating electricity to meet higher-valued peak power contracts, self consumption, and incidental sale, but bio-oil production using pyrolysis may be too expensive for generating electricity using bio-oils in the study region.

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